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Bosch Group acquires key assets of TSI semiconductors to expand EV chip output

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Germany’s Bosch Group has agreed to purchase key assets of California-based TSI Semiconductors in a bid to expand its US production of silicon carbide chips for electric vehicles (EVs). While the purchase price remains undisclosed, Bosch plans to invest $1.5 billion to retool TSI’s chip production facilities in Roseville, California, with the goal of commencing silicon carbide chip production by 2026.

According to Bosch’s statement, the investment is heavily dependent on federal funding opportunities through the CHIPS act and state subsidies. The TSI facility will become the “third pillar” of Bosch’s in-house semiconductor production, joining two existing sites in Germany.

Over the past two years, Bosch, like other automotive manufacturers, experienced significant disruptions to semiconductor production in Asia, which were exacerbated by the COVID-19 pandemic. Although these shortages have eased, they have not disappeared entirely. Consequently, Bosch’s automaker customers continue to seek more secure and diversified sources of chips.

Bosch stated that the silicon carbide chips manufactured at the TSI Roseville site are in increasing demand by EV manufacturers. The silicon carbide chemistry provides greater driving range and faster recharging capabilities. Bosch reported that the demand for silicon carbide semiconductors is growing by 30% annually.

This growing demand has spurred significant investment in silicon carbide chips. US-based Wolfspeed Inc is constructing new plants in New York State and Germany, while Onsemi Corp is also heavily investing in the technology and has signed a strategic agreement with Volkswagen AG to supply the automaker with chips.

The TSI site currently functions as a foundry for application-specific integrated circuits (ASICs), which are used across various industries. Bosch intends to acquire TSI’s buildings, machinery, infrastructure, and commercial semiconductor business. Following factory retooling, Bosch plans to begin producing silicon carbide chips on 200-millimeter wafers – the silicon discs on which chips are produced – in 2026, within 10,000 square feet of clean room space.